Billboard giant Lamar Advertising Co.’s shares jumped 24 percent Thursday after the company reported third-quarter earnings of $4 million, or 4 cents per share, compared with $781,000, or 1 cent per share, a year earlier.
Lamar’s shares closed Thursday at $26.07, up $5.04.
The stock had not closed that high since late July. More than 4.1 million shares changed hands, nearly 2? times the normal trading volume.
Lamar’s revenue grew to $296.7 million.
That was a 3.7 percent increase over the $286.1 million recorded a year earlier.
Stock analysts surveyed by Thomson Reuters had forecast earnings of 7 cents per share on revenue of $292.3 million.
During a conference call with analysts and investors, Lamar Chief Executive Officer Sean Reilly said revenue from digital signs was up 18 percent overall; the company has added more than 200 so far this year with 40 more on order.
The revenue from digital signs in place last year was up 5 percent to 6 percent, and revenue from traditional signs was up about 2 percent, he said.
“So I think, with confidence, we can say two things: We are growing our digital business, not wholly at the expense of our traditional business, No. 1; and No. 2, the dollars we’re spending on digital are getting us a great return,” Reilly said.
Stock analysts had wondered whether the revenue growth generated by Lamar’s digital signboards might be the result of customers shifting their advertising from the traditional signs.
“I think the data is pointing to a pretty strong case that digital is enhancing the overall platform and not just moving customers around,” Reilly said.
In September, for example, digital revenue was up 26 percent with same-board growth up 5 percent to 6 percent, he said.
Reilly also said the company has been able to measure some of the impact of the recession on its customer base.
In 2008, Lamar had 46,000 customers, but that number fell to 40,700 in 2009, in the depths of the recession, Reilly said. The customer count, as of Thursday, was 41,152.
Reilly said he is encouraged by the upward trend because the customers Lamar lost tended to be smaller businesses.
Seeing them come back is a good thing, Reilly said.
Revenue from local advertisers grew 4 percent during the third quarter while revenue from national advertisers rose by 3.2 percent.
Lamar estimated its fourth-quarter revenue will be around $284 million, compared WITH $275.7 million in fourth quarter 2010.
For the year, that would give Lamar revenue of $1.13 billion; the company’s 2010 revenue was $1.09 billion.